ROI Calculator 2026-27
Evaluating an opportunity? See what it actually returns.
Calculate ROI (Return on Investment) for any investment in United Kingdom. Enter what you invested and what you received back. Shows total ROI percentage, gain or loss, and annualised return per year.
Past returns do not guarantee future performance. Consider tax on investment gains.
How to calculate ROI and annualised returns in the UK
ROI is a foundational investment metric but can mislead when holding periods differ. CAGR (annualised return) fixes this and should be the primary comparison tool.
Total ROI formula
ROI = (Return - Investment) ÷ Investment × 100. Simplest measure of profit or loss. £10,000 invested, £15,000 returned = 50% ROI. Doesn't account for how long the investment was held.
CAGR — the annualised return
CAGR = (Return ÷ Investment)^(1 ÷ years) - 1. Over 5 years, 50% total ROI equals 8.45% CAGR. CAGR is the constant annual rate that would produce the same total return through compounding. Essential for comparing investments of different durations.
When ROI and CAGR tell different stories
Investment A: 80% over 3 years = 21.6% CAGR. Investment B: 80% over 10 years = 6.1% CAGR. Same total ROI, very different performance. Always compare on CAGR.
Accounting for dividends and income
Total return includes both capital appreciation and income (dividends, interest, rent). Reinvested dividends compound dramatically: FTSE 100 price return since 1999 is ~50%, but total return (with dividends reinvested) is ~200%. Always use total return when calculating ROI.
UK investment return benchmarks by asset class
Typical annual returns (CAGR) by UK asset class
| Asset class | Typical CAGR | Risk level | Time horizon |
|---|---|---|---|
| Cash / easy access | 4-5% | Very low | Any |
| Cash ISA | 4-5% tax-free | Very low | Any |
| UK gilts | 4-5% | Low | Medium |
| Corporate bonds | 5-6% | Low-medium | Medium |
| FTSE 100 index | 7-8% | Medium | 5+ years |
| FTSE All-Share | 7-8% | Medium | 5+ years |
| Global equities | 8-10% | Medium | 5+ years |
| UK residential property | 6-10% (incl. yield) | Medium | Long |
| REITs | 5-8% | Medium | 5+ years |
| Small-cap / growth | Highly variable | High | 5-10+ years |
| Private equity / VC | 10-15% target | Very high | 7-10 years |
Minimum return to beat UK inflation
With CPI at ~2.5%, investments need to exceed 2.5% to maintain purchasing power. Cash ISAs at 4-5% exceed this; general savings taxed at 20-45% may not. Stock market investments over 5+ years have reliably beaten inflation by 4-5% annually.
Good ROI for UK property
Gross rental yield: 4-7% typical. Add capital growth (2-5%/year) and total ROI reaches 6-12%. After mortgage interest, maintenance, tax, and void periods, real ROI on buy-to-let is typically 3-6% per year.
UK tax on investment returns 2026-27
Capital Gains Tax (CGT)
Annual exempt amount: £3,000 (2026-27, down from £12,300 in 2022-23). Rates: 18% basic rate, 24% higher rate on shares and most assets. 18%/24% on property (was 18%/28% before April 2024). Paid via Self Assessment or within 60 days for property.
Dividend tax
Dividend allowance: £500 (2026-27). Rates: 10.75% basic rate, 35.75% higher rate, 39.35% additional rate. Applies to dividends above allowance. Inside an ISA: completely tax-free.
Interest income
Personal Savings Allowance: £1,000 for basic-rate taxpayers, £500 for higher-rate, £0 for additional-rate. Above allowance: taxed at your marginal rate. ISA interest is always tax-free.
ISA: the UK tax-free wrapper
£20,000 annual allowance. All capital gains, dividends, and interest inside an ISA are tax-free. Can be cash, stocks & shares, innovative finance, or Lifetime ISA. Lifetime ISA adds 25% government bonus for first home or retirement.
Pension tax treatment
Contributions: tax relief at marginal rate. Growth: tax-free inside pension. At retirement: 25% tax-free, rest taxed as income. Most tax-efficient long-term wrapper for UK investors.
UK investment ROI worked examples
Stocks & Shares ISA over 10 years
£10,000 invested in FTSE All-Share ISA at historical 7.5% CAGR. Final value ~£20,600. Total ROI: 106%. All tax-free inside ISA.
Buy-to-let property over 5 years
£300,000 property with £75,000 deposit. Rental income £18,000/year (6% yield), costs £5,000/year. Property sold for £360,000. Gross gain: £60,000 capital + £65,000 net rent = £125,000 before CGT. ROI on £75,000 deposit: 167% total, 21.7% CAGR.
Fixed-rate bond over 2 years
£20,000 at 5% Ofgem for 2 years. Final value £22,050. ROI 10.25%, CAGR 5%. If in taxable account at 20%: net £21,640 (9.3% ROI). In ISA: full £22,050.
Premium Bonds over 5 years
£10,000 held for 5 years, averaging 4% tax-free prize yield. Typical return £2,166. ROI 21.7%, CAGR 4%. Tax-free for all taxpayers.
FAQFrequently asked questions about UK ROI
What is the difference between ROI and CAGR?
ROI = total percentage gain. CAGR = equivalent annual growth rate. 50% ROI over 2 years is 22.5% CAGR; over 10 years it's 4.1% CAGR — very different performance. Use CAGR for comparison.
Do I pay tax on investment returns UK?
Yes, unless inside an ISA or pension. CGT applies above £3,000 annual exemption (18% basic, 24% higher). Dividend tax above £500 allowance. ISA wraps all returns tax-free.
What is a good ROI UK?
Depends on risk and timeframe. Cash/ISAs: 4-5% is good. Stocks over 5+ years: 7-8% CAGR is realistic. Property: 6-10% total return. Anything consistently above 8% CAGR long-term is excellent.
How do I calculate ROI on rental property?
Total ROI = (Rental income + capital gain - all costs) ÷ Initial investment × 100. Include mortgage interest, maintenance, tax, void periods, and agent fees. Use cash-on-cash ROI (annual cash flow / cash invested) for yield-focused analysis.
What ROI should I expect from a Stocks & Shares ISA?
Historical FTSE All-Share: 7-8% CAGR nominal, 4-5% real after inflation. Global equities slightly higher at 8-10% nominal. Use 6% as a conservative long-term planning figure.
Is ROI before or after tax?
Can be either — state which when reporting. Compare investments on the same basis. For UK comparison, after-tax is most meaningful (ISAs vs taxable accounts). For investment selection, pre-tax return may be clearer if tax treatment is the same.
Where these figures come from
Savings and interest figures on this page are drawn from The Bank of England (Bank Rate), HMRC (ISA and savings tax rules), the Financial Services Compensation Scheme (deposit protection), and the Financial Conduct Authority (consumer protection).
- Bank Rate (base rate) — Bank of England — The Interest Rate (Bank Rate).
- ISA annual allowance & rules — GOV.UK — Individual Savings Accounts (ISAs).
- Personal Savings Allowance — GOV.UK — Tax on savings interest.
- FSCS deposit protection (£85,000) — FSCS — Financial Services Compensation Scheme.
- Consumer money guidance — MoneyHelper — Savings.
Last checked: April 2026. Rates and thresholds are reviewed against the source of record each November, when annual adjustments for the following tax year are published.
Select the question that matches where you are right now.
Your result shows the projected growth or return based on the rate, contribution, and time period you entered — using standard compound or simple interest formulas.
Use this to set savings targets, compare investment options, or understand the impact of starting earlier. Adjust the rate and timeframe to model optimistic and conservative scenarios.
Not a guaranteed return. Actual investment outcomes depend on market conditions, fees, taxes, and timing that cannot be predicted with certainty.
Uses standard financial formulas with the inputs you provided. All calculations run in your browser — no data is sent to any server.
Savings and investment results are dominated by three factors: the rate of return, the time horizon, and regular contributions. Compounding amplifies all three over time.
Returns on returns accelerate growth over time. The difference between 5% and 7% over 20 years is much larger than the 2% gap suggests — compounding is non-linear.
Adding even small regular amounts dramatically increases the final balance. £100/week invested at 7% for 20 years grows to over £110,000 in contributions and £110,000+ in returns.
Starting 5 years earlier often produces a larger final balance than doubling your contribution rate. Time is the most powerful variable in savings calculations.
To improve your savings outcome, focus on starting earlier, increasing contributions, and minimising fees and tax drag on returns.
Starting with a small amount today and increasing over time beats waiting to start with a larger amount. Time in the market matters more than timing the market.
A 1% annual fee on a £100k balance costs £1,000/year and compounds against you. Compare fee structures across savings and investment products.
Super, offset accounts, and tax-free thresholds reduce the drag of tax on your returns — letting more of the growth compound for you.
Savings decisions connect to investment, tax, and retirement planning. Use these calculators to model the broader picture.
Work backwards from a target amount to see how much you need to save each month.
Savings goal →Model how an initial investment grows with regular contributions over different time periods.
Compound interest →See what your future balance is worth in today's dollars after adjusting for inflation.
Inflation calculator →